Bad Apples and Barrels

By Patrick L. Warren

We spend a lot of time and identifying and talking about superstars: in sports, in business, in academia. I'm guilty too, in my (mostly failed) Nobel prediction from a couple weeks back. My colleague teased us all with Jennifer Lawrence last week, surely a superstar if there ever was one. But an intriguing recent paper from Michael Housman and Dylan Minor suggests that we should be, perhaps, be paying a little more attention to the other end of the distribution. In a large dataset of employee records in a single firm they identify a set of "Toxic Workers," those who were eventually "involuntary [terminated] due to an egregious violation of company policy. Examples include sexual harassment, workplace violence, falsifying documents, fraud, and general workplace misconduct." They then look back to see how the presence of one of these workers affected performance of the team, performance of teammates, and the chance of "infecting" co-workers. In some back-of-the-envelope calculations they find that identifying and hiring a superstar (top 1%) is less than than half as valuable as avoiding a toxic worker. It's a nice paper. You should check it out. (HT: Florian Ederer @florianederer)